Nonprofits faced enormous challenges during the crises of 2020 but generally emerged stronger than they feared they would, according to results of a new survey from the Center for Effective Philanthropy (CEP).
Released today, Persevering through Crisis: The State of Nonprofits, draws on the experiences of members of CEP’s Grantee Voicepanel, which is carefully assembled to be representative of nonprofits that receive at least one grant from foundations giving $5 million or more annually. The report’s key findings:
- Most nonprofit leaders report that the COVID-19 pandemic has had negative impacts on their organizations and has affected their programming, revenue, demand, and costs. Arts and culture organizations have experienced more negative effects from the pandemic, while community and economic development organizations experienced fewer negative effects.
- Increased financial support from foundations, individual donors, and the government—including Paycheck Protection Program (PPP) funding—helped nonprofits to fare better through 2020 than their leaders had originally anticipated.
- Many nonprofits report that their foundation funders were flexible, responsive, and communicative in 2020. However, nonprofits led by women and nonprofits serving certain communities somewhat less flexibility, responsiveness, and communication than other nonprofits.
CEP Research Manager Hannah Martin, lead author of the report said, “Nonprofits faced massive challenges in 2020, no doubt. But, thanks to the response of institutional and individual donors and, very significantly, the federal government, they did better than they feared they would when we surveyed them in May 2020. This matters greatly because nonprofits did, and are still doing, vital work to help those hit hardest by the pandemic and related challenges.”
The report details how many nonprofits experienced a shift in foundation practices during this time – saying their foundation funders provided more flexible grants, communicated about future funding, allowed the goals of existing grants to shift, and lifted up the voices of the people and communities nonprofits serve.
However, nonprofits led by women and nonprofits serving certain communities of color experienced these changes from their foundation funders to a lesser degree.
CEP Vice President-Research, Ellie Buteau, PhD said, “Although the report looks back at how nonprofits have managed through perhaps uniquely challenging times, it raises many questions for the future. “From this research, many questions follow. Will individual donors and foundations continue to flex their levels of support in future crises? Will foundations make some of the changes in how they work with nonprofits more permanent? And will they take a hard look at the differences in experiences among nonprofit executive directors that our research revealed?”
Leaders whose organizations primarily serve Asian communities, for example, report fewer foundations providing new unrestricted support to their organizations. And nonprofits led by women—the majority of organizations in the study—were less likely than those led by men to report experiencing increased flexibility, responsiveness, and communication from their foundation funders.
CEP is also tracking the way foundations are, or aren’t, changing as a result of the experience of 2020 in a separate, ongoing research study. Results from that effort will be released later in 2021.